Question: I am a German scientist and will spend the next 3-4 years in the US to conduct my research. Before I lived about 5 years in the Netherlands, Therefore I am not in the German retirement system. So I was wondering, how I could best invest my money for retirement savings. Would I be eligible for any US programs (do they exist?) Thank you very much for your help. Sylvia, San Diego, CA

Answer: The key to answering this question is whether you're earning an income. If you are getting paid in the U.S. the basic answer is that there is no reason why you can't set aside some of that money into an employer-sponsored 401(k), 403(b), or comparable savings plan. If your employer doesn't offer a retirement plan you can set up an Individual Retirement Account (IRA) and fund it from earnings.

You can't set up an IRA without earned income. For instance, you can't be living off dividend income. And if you're on a fellowship it must generate a W-2, and most don't.

Assuming you are earning an income the answer about retirement savings quickly gets complicated. For instance, our retirement savings system gives employers a lot of say in how their plans are set up. You'll need to check with the human resources department to find out when you're eligible. An IRA is simple to establish, but the rules are Byzantine. However, once you know your situation you can check out the websites of major U.S. financial institutions. Most offer good essential information on the various retirement plans.

When you return to Europe you can leave the money behind if you want to compound tax deferred until retirement. There are tax treaties to take into account if you want to take the money with you.

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